While revenues and profits were both down in the three months to end February as the credit crunch bit hard into Wall Street, the drop was much less than analysts had been forecasting.

The bank, dubbed "Goldmine Sachs" by many on Wall Street because of the huge bonuses it pays to staff, made revenues of $8.34bn over the three months, down from $12.7bn in the previous year. Profits of $1.51bn (£748m), or $3.23 a share, were down from $3.2bn, or $6.67 a share in the same quarter last year.

"Market conditions are clearly very difficult," said chairman and chief executive Lloyd Blankfein. "But we saw strong customer activity across many of our franchise businesses in the first quarter. Although market conditions present many challenges at the moment they also offer considerable opportunities."

In fact, Wall Street analysts had expected earnings to fall as low as $2.58 a share and Goldman Sachs' outperformance is expected to cheer investors reeling from Monday's shock firesale of Bear Stearns.

Goldman Sachs was by no means immune from the turmoil in the global markets but has weathered the storm much better than its rivals.

Revenues in its investment banking business of $1.17bn were down 32% on the previous year as the tightening of the global credit markets saw mergers and acquisitions business reduce and the bank underwrite less debt. As a result Goldman Sach, which ranks as the world's number one advisory firm by size of deals, saw its first quarter advisory fees of $663m drop 23%.

Trading revenues were down 46% at $5.12bn as revenues from the banks fixed income, currency and commodities business dropped 32% to $3.14bn. The bank made a net loss of $1bn on residential mortgage loans, a result of the ongoing sub-prime mortgage crisis. It also made a loss of another $1bn on some low-grade investments.

The bank's asset management business, in stark contrast, actually saw revenues increase 28% to just over $2bn. At the end of the quarter it had $873bn funds under management, having attracted $29bn more investment during the quarter, although the overall value of its investments dropped $24bn as markets across the world fell.

Separately, overnight it emerged that Goldman Sachs has replaced its main forecaster of short-term market moves, Abby Joseph Cohen, who was very prominent during the bull market of the 1990s, with David Kostin who she hired four years ago. Cohen has been promoted to become president of Goldman's Global Markets Institute and senior investment strategist.